The tax community’s focus this year initially was on what the U.S. Supreme Court would decide in Moore v. United States. That case dealt with the Tax Cuts and Jobs Act’s Mandatory Repatriation Tax on corporations’ foreign earnings. There was concern that if the justices invalidated the tax, which attributes the realized and undistributed income of an American-controlled foreign corporation to the entity’s American shareholders, the entire U.S. tax code could unravel. Those fears were alleviated on June 20 when the Supreme Court of the United States (SCOTUS) upheld the repatriation tax. But a new tax worry popped up in... Read more →

Sometimes the only way to catch wrongdoers and end abuse is by getting inside information. But whistleblowers often are fearful of coming forward, despite myriad laws designed to protect those who come forward. These protections were enacted for the most part in the Whistleblower Protection Act, enacted in 1989. While it focused on federal employees, the Occupations Safety and Health Administration (OSHA) created the Whistleblower Protection Program to enforce existing statutes that prevent employers from retaliating or discriminating against a whistleblower. Now some U.S. Senators are looking to update the 35-year-old law, specifically with regard to federal employee whistleblowers who... Read more →

Photo by Lance Reis on Unsplash In March, the Internal Revenue Service and Treasury Department announced they were going after non-filing millionaires. Today, they reported that the IRS has collected more than $1 billion from high-wealth taxpayers with past-due taxes. With resources bolstered by added Inflation Reduction Act funds, the IRS said it stepped up compliance activity specifically on 1,600 individuals whose incomes were more than $1 million per year and who each owed the IRS more than $250,000 in recognized tax debt. The IRS assigned 1,500 to revenue officers to the cases. They got payments from more than 1,200... Read more →

Photo by Clay Banks on Unsplash Nebraskans frustrated by their state’s inability to come up with property tax relief plan turned to a broader tax overhaul, the EPIC plan. EPIC stands for Eliminate all Property, Income and Corporate taxes. The measure would have constitutionally prohibited the legislature from imposing any tax except for a state-administered sales tax. EPIC was first introduced in the Nebraska legislature in 2023, but never made it out of committee. That’s when the plan to take it directly to the state’s voters was born. But that’s not going to happen either. Epic ballot initiative fail: “The... Read more →

Next Monday, July 15, is Tax Day for residents of disaster areas in three states. This tax deadline applies to taxpayers affected by Federal Emergency Management Agency (FEMA) major disaster declarations in parts of Alaska, Maine, and Rhode Island. The disaster areas are listed below. The bold-type state names are links to the Internal Revenue Service's tax relief announcements for each area. The Wrangell Cooperative Association of Alaska Tribal Nation off coastal Alaska. That area was hit by severe storms, landslides, and mudslides that began on Nov. 20, 2023. Eight counties in Maine that sustained damages from severe storms and... Read more →

Updated Tuesday, July 9, 2024 Residents whose lives are disrupted by a major disaster are targets. So are those who want to help. Either way, don’t become a victim. Hurricane Beryl, the second named storm of the 2024 tropical storm season, made her third landfall early today along the Texas Gulf Coast. The good news is that Beryl was a category 1 when it blasted into the Lone Star State. That's far less powerful than the category 5 it reached on its travel through the Caribbean and Gulf of Mexico. The bad news is that Beryl was still a hurricane.... Read more →

That will leave a dozen states still taxing at least some food bought by grocery shoppers. My favorite section of my local H-E-B grocery. (Photo by Kay Bell) When you loaded up your grocery cart for your July 4th spread, you probably weren’t thinking about taxes. That’s because most of us live in states that, for the most part, don’t tax food. That’s not the case in 13 states. Those jurisdictions do tack a few percentage points of sales tax on most foodstuffs. But one of those states will join the no-grocery-tax ranks later this summer. In late August, Oklahoma’s... Read more →

Updated NHC Key Messages graphic Sunday, July 7, 2024 NOAA NHC GOES satellite image of Beryl. Click on image for animated loop. Hurricane Beryl, the second named storm of the 2024 hurricane season, already has made meteorological history. Beryl's formation at the end of June made it the earliest hurricane ever in the eastern tropical Atlantic. But wait, there's more. Beryl also became the strongest hurricane on record, a category 4, to have formed in June in the Atlantic Ocean. Beryl's journey over Mexico's Yucatan Peninsula took sapped some of its strength, but it's still expected to hit the Texas... Read more →

I hope you’re having a great long July 4th holiday break. I’m catching up on some podcasts, and one is a good fit for this week's Tax Felon Friday feature. Guy Ficco, who took over as head of the IRS Criminal Investigation division in April, spoke with Bloomberg Tax reporter Erin Slowey in the latest edition of Talking Tax podcast. Ficco has spent his 29-year IRS career as part of CI, so he’s seen firsthand how the tax investigative component has changed over the years. Changing times: Some things have evolved for everyone in every job. Many can relate to... Read more →

Photo by Rene Bernal on Unsplash Happy Independence Day, America! Or as we call it at our house, the July 3 Until Whenever Our Neighbors' Fireworks Stash Is Fully Exploded holiday. Yep, residents of our suburban enclave started celebrating last night. It's an annual dress rehearsal for the full array of pyrotechnics today. And it continues for days. I’m sure the hubby and I are not alone. In 49 states and the District of Columbia, private display of certain types of fireworks are legal. Which jurisdiction is the outlier? Massachusetts is the only U.S. state where it is illegal to... Read more →

Photo by Leeloo The First Tax scams tend to slow down after the main federal return filing season, but they never go entirely away. That’s still true as we head into the heart of summer 2024. The Internal Revenue Service is warning taxpayers there is a new scam involving the purchase of clean energy tax credits. This latest scheme, like so many, is based on a real tax break. Legal credit, but limited: The Inflation Reduction Act, which President Joe Biden signed into law on Aug. 16, 2022, contained provisions that dramatically changed federal clean energy tax credits. The law... Read more →

Some of the school supplies at my local H-E-B grocery. Most of these products will be tax-free during Texas' back-to-school tax holiday in August. (Photo by Kay Bell) Summer arrives in full force in July. So do the annual — cover your ears, children — back-to-school tax holidays. Yes, classes will resume before you know it. And this month, shoppers in five states and Puerto Rico will get some tax-free savings during events typically touted as school-related. In reality, lot of us long past school days can enjoy many of the tax-exempt items. If your state doesn’t hold a sales... Read more →

Unsplash+ in collaboration with Olivie Strauss Hello, July! We are soooo ready for this first full month of official summer. This first week of July will be a short one for many of us. We’ll be taking advantage of July 4 falling on Thursday, making it an extra-long Independence Day holiday weekend. But once the fireworks are over, it’s back to the regular grind where we never are independent of taxes. That’s why we also need to also make some time in July for tax moves. Here are five to consider. 1. Get ready for disastrous weather. Even though I’m... Read more →

Photo by cottonbro studio The Internal Revenue Service's whistleblower program helped the agency collect $338 million in fiscal year 2023. The IRS Whistleblower Office also noted in its 2023 report, issued on June 24, that it paid whistleblowers 121 awards, totaling $88.8 million, for the revenue-increasing information. That awards total was more than double the $37.8 million the office paid in fiscal 2022. But the total number of whistleblower awards for FY23 dropped, going from 132 in 2022 to 121 the following fiscal year. And to keep the Whistleblower Office on pace to help with tax compliance, the latest report... Read more →

Photo by Nick Night on Unsplash All taxpayers are supposed to be guaranteed privacy when it comes to their tax information filed with the Internal Revenue Service. Unfortunately, the IRS’ system is not immune to security breaches. Most of the time, it’s regular taxpayers like you and me whose personal data is of interest to crooks who want it to file fraudulent tax returns. But from 2018 to 2020, an IRS contractor stole years of tax returns and filing information related to thousands of the United States' wealthiest people. The contractor, Charles Littlejohn, then disclosed that tax info to the... Read more →

A good working relationship can make a boss and employee a great team. But sometimes, greed gets the better of one of them. (Photo by SEO Galaxy on Unsplash) One of my previous jobs was assistant to an executive in a multinational corporation. Among my duties was helping my boss draft our department’s annual budget. I also was her surrogate in reviewing and processing expenses for our area’s employees, as well as making payments for other expenditures. My boss and I worked closely on these and other projects, and over the years we also became good friends. We shared years... Read more →

The Internal Revenue Service’s long-standing goal of regulating noncredentialed tax preparers got some support from the Electronic Tax Administration Advisory Committee’s (ETAAC) 2024 annual report. Such oversight is one of a dozen recommendations in the latest ETAAC document, released June 26. It is one of three suggestions the panel directed to Congress; the remaining nine ETAAC recommendations are for the IRS. ETAAC goals: ETAAC is a volunteer panel established by Congress in 1988 to provide public input into the development and implementation of the IRS organizational strategy for, as the name says, electronic tax administration. To that end, ETAAC researches,... Read more →

Unsplash+ in collaboration with Kateryna Hliznitsova One of the biggest, most persistent complaints about the Internal Revenue Service is the agency’s service, or lack thereof, in answering taxpayer phone calls. The IRS has improved in this area, according to the National Taxpayer Advocate’s midyear report to Congress released today. The Treasury Department and the IRS established the Accounts Management (AM) Customer Service Representative Level of Service (LOS) standard to measure taxpayer service. For the past two filing seasons, notes National Taxpayer Advocate (NTA) Erin M. Collins in her report, the Treasury/IRS LOS goal of at least 85 percent was met.... Read more →

Updated, Thursday, June 27, 2024 Update, Thursday, June 27, 2024: The Internal Revenue Service today granted tax relief to Mississippi taxpayers in major disaster areas from early-April severe weather in that state. You can find details in the post text below. The National Oceanic and Atmospheric Administration's (NOAA) most sophisticated Geostationary Operational Environmental Satellites (GOES) is the GOES-R Series. The satellites provide advanced imagery and atmospheric measurements of Earth’s Western Hemisphere, real-time mapping of lightning activity, and improved monitoring of solar activity and space weather. Photo courtesy NOAA/National Environmental Satellite, Data, and Information Service (NESDIS). Being a life-long weather and... Read more →